We opened 2 Fidelity HSAs last year. Mine is strictly for the $1,000 spousal catch up contribution. My husband’s receives a 12 month rollover from his Payflex HSA. This avoids him having to pay Payflex’s new monthly investment fee they started charging last year that would have cost us $10+ per month. We just keep the employer/employee contributions in cash at Payflex, where it isn’t charged a fee. We’re doing the rollover vs. a trustee to trustee transfer, because Payflex would charge $25 for that, too. 
A huge plus is better investment options at Fidelity anyway.
1 Like
I did a search on this topic for “California” and didn’t see anyone mention the fact that any gains are taxable by California state. I’m not sure if there is any special strategy that should be used by Californians who have HSAs but I thought I would point this out.
I am going to check with employer and see if they allow any additional contributions?
I can open my own HSA account before joining new job and max out contributions?
One question I’m still struggling with for HSA is whether it’s better to have two separate ones for spouses or mostly a main one (and another one only for catch-up contributions for the other spouse). Main reason to keep a main one is that some custodians have better investment options for HSA funds (and/or lower expense ratios) with larger balances. Splitting the HSA money evenly goes against that.
With spouses as beneficiary, either should bypass probate if need be. Could be a small delay in availability of funds as one HSA rolls into the other but manageable.
So I’m wondering if there is an advantage to having separate HSAs vs one single one for married couples. Anyone here weighted the pros and cons of each scenario?
Each account must be associated with 1 and only 1 social security number. It is just like a retirement account. You also cannot move money from one spouse to another. It must stay with that person.
Correct, although it can transfer on death of the account owner to their surviving spouse which would be good enough for our purposes. However, in case of divorce, that could become an issue the court would need to address in splitting assets of a couple.
I’m sure someone in this thread must have mentioned the requirements. If not, please let me know and I’ll give you a couple of links to the rules.
1 Like
Can you please provide me links. I need to talk to HR and see if they can help me. I have 2 more weeks to stay with current employer.
We only had the main one (Payflex) with my husband’s employer, until I became eligible for the catch up contribution. Now we have 3 because of Payflex instituting that monthly fee, as I mentioned a few posts above. We didn’t/don’t concern ourselves with the fact that the bulk of the HSA money is in my husband’s name. It’s his employer-provided health insurance, after all. Reimbursement for our medical expenses comes out of his Payflex HSA.
If you lose these, just remember to search on “hsa account rules” The following should be in the top 10 results.
Here are two easy to understand pages that give some good ideas:
From Investopdia
From Investors.com
And one for details.
Pub 969
Good luck!
And once you are on Medicare, having most of the HSA money in his name shouldn’t be an issue despite being covered by individual insurance since your own health expenses and medicare premiums are qualified expenses for spouse and dependents.
3 Likes
I am going to switch to new employer. My current employer benefits are going to expire by end of this week(last working day). If i am going to join new employer on Monday, i am going to miss insurance coverage during the weekend. There is a Corba coverage. Do i need to select Corba coverage for weekend. I might be receiving CORBA coverage selection application some time later. how do you guys manage this kind of situation?
Thanks
Usually health insurance is month to month - once covered in Feb, covered for all of Feb. I find it very hard to believe that both your current insurance will terminate on Feb 7, and even harder to believe that coverage through your new employer is going to start immediately, mid-month. And hardest yet to believe that you can sign up for Cobra coverage for a weekend.
No offense, but I’m pretty sure you arent understanding…well…just about everything regarding your old and new health coverage periods.
3 Likes
I am reviewing separation documents. This is what they have it in the document,
"Health and Welfare Your Health and Welfare benefits at xxxxxx will terminate at midnight on the last day of your employment. The Health, Dental, Vision, and EAP COBRA administration is outsourced to Discovery Benefits, who distributes the COBRA Notice of Continuation of Coverage continuation rights and election forms utilizing United States Postal Service. In accordance with COBRA, you may elect to continue health, dental, vision, EAP insurance for you, your spouse, and/or eligible dependents. COBRA is not a separate insurance plan; it is an election to continue the same coverage you had as an associate. To elect COBRA coverage, you must complete the election form and send it to the COBRA administrator, Discovery Benefits. Please note that since Discovery Benefits must mail the election form to you and you must complete and return the election form to them, there will likely be a delay in time which you show active coverage by UnitedHealthcare (UHC). However, if you do timely elect and pay your COBRA premium, you will not experience a gap in coverage even though UHC may not yet reflect your coverage reinstated in their system. This means during this processing time, you may need to pay out of pocket for expenses and then submit for reimbursement once the UHC system reflects your reinstatement of coverage through COBRA. "
I think he’s been pulling our leg on most of this.
I am posting based on the information received from my current employer HR. I also checked with new employer. Benefits are going to start from 1st of March. Checking one more time with current employer if it is last date of employment or end of the month. Are these rules same for every company. I am in TX.
I work for a large publically-traded company and our coverage works the way ritholtz’s does; that is, it is effective as of the hire date and terminates on the day employment ends.
Also, why wouldn’t you be able to enroll in COBRA for a weekend? Granted, in almost all cases it wouldn’t make sense. But if I happened to get seriously injured in between coverage, you bet I’m going to look into the possibility of signing up for COBRA to cover those bills. It would be a retroactive thing, of course, but I don’t see why it wouldn’t be possible.
No. You have 60 days to elect COBRA. If you don’t need any medial care during the gap in coverage, you just don’t do anything. If you happen to get seriously sick or injured during the gap, get medical care. Then, you can elect COBRA and it will retroactively apply to the day you lost coverage, thus covering the care you received. It’s slightly more complicated than that, you cn find the details in your Summary Plan Description or on the internet. But the short answer is you don’t need to worry about it unless you happen to need medical care, and then you can make the election retroactively.
4 Likes
This. Additionally, if you have a gap over 60 days, you can elect Cobra and then choose whether or not to pay for it when the bill comes. Depending on how long they take to bill you and how long you have to pay the bill, this could give you another chunk of time to wait and see if you get sick. Assuming the best case scenario for someone that will have 4 months between coverage, you could wait 60 days, elect COBRA, 30 days later you get a bill for COBRA that’s due 30 days later. And the day before your COBRA bill is due, your new coverage starts and you never went to the doctor during those 4 months. You had “insurance” for 4 months, but it ends up not costing you a dime because you didn’t need “use” it. Always wait to pay the COBRA bill even if you had to go to the doctor. It’s likely that you can pay out of pocket for an office visit for less that than a month or several months of COBRA would cost.
1 Like